Inflation level to keep below 5% in '06-07

NEW DELHI: With inflation rising to 4.92% during the week ended August 12, Centre on Friday said efforts were on to keep it below the psychological level of 5% this fiscal.

For doing this government would have to take steps to augment supply of pulses, wheat and sugar, prices of which have led to rise in inflation. Inflation touched 5.24% during the week ended June 10 and then 5.44% the following week.

"Our tolerance for inflation has come down. We have to have inflation at tolerable levels," Finance Minister P Chidambaram said.

The minister said government was making all effort to provide ample liquidity to soften the impact of hardening global interest rates.

"Hardening of global interest is not in our control. What we are doing is to ensure ample liquidity so that the impact of hardening interest rates is softened," he said.

During the week ended August 12, it was mainly prices of essential items like vegetables and fruits as well as some manufactured products that pushed inflation up.